Retailers using controversial marketing tools

When you're shopping, you're being watched. And not just by security. Retailers want to know everything about how you behave in their stores.

When you're shopping, you're being watched. And not just by security. Retailers want to know everything about how you behave in their stores.

And now, two Bay Area companies are working on technologies that will watch you like never before. We have a look at what these new marketing tools could mean for your privacy.

Sometimes a sign is just a sign. But sometimes, it's watching you.

"This sign here, basically has a small camera hidden into the back of the sign," said Mark McGowan.

He's a Product Director for EFI, they're in the printing business. But now, they're getting into the camera business.

"As I look at the sign, as you can see, my face is now circled," McGowan said.

It's called SmartSign. It's an ordinary cardboard sign, with an extraordinary ability to recognize faces. It can tell if you're looking at it, and for how long. And it's remarkably good at telling your age and gender.

When asked why put a camera in the sign, EFI Chief Technology Officer Ghilad Dziesietnik answered, "Well, because that's the best way to attract the immediate reaction of the observer in the sign. It's a one-to-one viewing angle."

He says internet marketers can tell if you click on an ad. But stores often don't know if their displays are effective.

"Are people even looking at the sign?" Dziesietnik asked. "What is the focus they have on the sign? Who are the people that look at the sign?"

SmartSign gives all those answers on a colorful web page from a device so cheap that once they release it in a few months, it could be everywhere.

"We really see the cost getting down to really a couple hundred bucks to actually get one of these on the street," McGowan said.

But retailers don't have to put a camera in a sign to start learning more about their customers. In fact, some are already doing it with the cameras that are in the ceiling.

"A system like this can work using your own existing surveillance camera," 3VR Chief Marketing Officer Joe Boissy said.

San Francisco-based 3VR is mainly a security company. Founded with money from the CIA, they built facial recognition that profiles people by age and gender, and tracks them through the store.

"Understand exactly where they're standing, what are they doing, and where they dwell," Boissy said. "Even though some people might say it's controversial, the way we would like to talk about it is to say, we are a friendly big brother."

3VR has tools aimed at customer service:

"I can ask the system to alert me when the line gets longer than six people because maybe I need to send another staffing member out there," 3VR Field Sales Engineer Diego Simkin said.

It can even tell if customers are happy or upset. And it answers the all-important question about the conversion rate -- how many of the people walked into the store and bought something, because they have cameras connected to the point of sale.

And that's where it gets sticky. Cameras connected to cash registers. Privacy advocates say it could mean that stored image of your face is no longer anonymous.

"It could be linked to their credit card transactions at a register, and then the store just has a wealth of information available on people," said Jennifer Lynch with the Electronic Frontier Foundation. "We don't know what's happening to that data, how long it's being stored for, and who it might be shared with."

The EFF worries it could be used for invasive advertising; or, in the wrong hands, identity theft.

When asked what the solution is here, Lynch replied, "I think that the solution is for retailers to not store as much information."

EFI is taking that suggestion. SmartSign analyzes the video, but never stores it. All marketers see are the numbers.

3VR does keep the video, but says it's not linked to your identity.

"We're not tracking people, we're tracking profiles, things that help retailers and consumers at the same time, save time and money," Boissy said.

Consumer advocate Jon Fox likes that promise, but he's worried.

"I think the problem with that argument is that it relies a lot on us trusting companies," he said.